Android or Apple for Your Traffic Ticketing System | How to Choose: Pt 2

12 Mar 2013

Where is the mobile market now and what does it mean for parking management systems?

The remainder of this article, to be continued from last week in Part 1 of Android or Apple for Your Ticketing Software series, looks at reviews done on current smartphone and tablet market share and the factors that drive growth. We all know what doesn’t work, as Blackberry became a working model for what not to do; but, is there a success story to be championed in this mêlée and should we be surprised at who the winner appears to be or, is this just history repeating itself? A recent article reports with a great deal of skepticism, on suggestions that Android is in its death throes. The article’s rebuttal suggests, and quite succinctly demonstrates that this is simply not the case, that Android is, in fact, taking market share from “everyone”. The piece goes on to break down market growth into a few defining factors including Price, Existing Market Share, Consumer Loyalty and Financials.

Price

Data indicates that unshockingly, price is the primary factor for consumers when determining what type of smart device to purchase. Clearly the value for every dollar spent must match up. From a developer’s perspective, a combination of the market share and user base are key performance indicators that dictate whether or not to develop for a mobile platform. The race to woo developers has never been more fervently pursed than in Blackberry’s campaign pushing the Z10s new QNX platform, an affirmation that apps rule the roost and figure prominently in the equation for a successful smartphone or tablet maker.

Market Share

The tablet market is still Apple’s to claim as victor however Google’s steady market penetration is slowly closing that gap. Apple seems to have a knack for repeating history like the 1980s and 1990s Apple vs. PC wars which eventually saw its decline. Apple’s strength in product design, clairvoyance in terms of knowing what consumers desire before they even know they desire it and trendy marketing put Apple at the top of the heap. However, Apple also holds another title that seems to have become its Achilles’ heel: pricing. Apple products eventually lose luster as steep price points drive consumers to more affordable ‘good enough’ alternatives; a pattern very similar to the 1980s and 1990s that brought momentum to a crawl, threatens to repeat itself.

According to Strategy Analytics Apple’s share has shrank from 64.5% to 56.7% while Android has leaped from 29.2% to 41.3%

“Shipments of Android tablets surged to a new high in the third quarter of 2012, accounting for 41% of all tablets shipped. Neil Mawston, Strategy Analytics’ executive director, says that there’s no one Android tablet responsible for the surge, which is more due to a large influx of devices from a wide variety of vendors including Asus, Samsung and Nook.” Shipments of Apple’s iPad lineup, meanwhile, shrank to 57% of the market”.

Apple may still hold the lion’s share of units shipped for the time-being but, increasingly consumers are hard pressed to find a reason to buy Apple. Brand loyalty can only go so far in competing with the wildly successfully Nexus 7. Even more alluring is the Nexus’ price point at $199 versus the iPad mini’s $329 price tag. The Nexus 7 is also rumored to go down to $150 and eventually, $99. Should Apple be concerned? Probably, but what is of even greater concern is the alarming rate at which Android has gained market share in the smartphone market!

Having been referred to as a “sinking ship”, Apple’s current situation on the smartphone front is less than rosy. Five years in and five and a half iOSs later, it is safe to say that the honeymoon is over and the iPhone simply does not hold the caché it once had. According to the IDC the Android OS was found on 3 out 4 smartphones being shipped in Q3 2012.

“According to the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker, total Android smartphone shipments worldwide reached 136.0 million units, accounting for 75.0% of the 181.1 million smartphones shipped in 3Q12. The 91.5% year-over-year growth was nearly double the overall market growth rate of 46.4%.

Consumer Loyalty

Being familiar with an OS’s ecosystem plays a key factor in a consumer’s decision to stick with an OS. Something that would seem to work in Apple’s favor. Apps are another significant deciding factor in sticking with an OS. Google Play is gaining fast on the iTunes store and will eventually overtake it but currently, Apple apps generate 4x more profit.

Financials

Google’s stock would seem expensive at $828 dollars but it is, in fact, at a healthy average in terms of PEG ratio according to the average S&P 500 stock. Profits are nice and healthy, but the earnings growth could use improvement. Net income however, is very good at $10.56 billion. Total cash is $44.62 billion compared to $7.90 billion in debt.

Apple Vs Google: Mirrored Opposites in Stock Fluctuations

Google’s strategy of creating ‘good enough’ cheaper smartphones and tablets seems to be working as evidenced by its booming climb in market share and stock prices. What’s more, the quality and user experience of Android products, some would argue, is as good if not superior to that of the aging iOS. However until very recently, lest we forget, Apple has held the title of most valuable company in world. That being said, one thing we can be assured of is Apple’s ability to reinvent itself and the market as it has done time and again. Perhaps the biggest loser here is the PC. Due to its “dinosaur-aged” form factor perhaps, it will one day take up a place next to the DVD player, VCR and Laser Disc!